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Big Business and the European Agenda

Keith Richardson, "Big Business and the European Agenda", SEI Working Paper No. 35, Sussex European Institute, University of Sussex, September 2000.

In Defence of the Roundtable - Former ERT Boss Evaluates Ten Years in EU Corporate Politics

"Big Business and the European Agenda", written by Keith Richardson, former Secretary General of the European Roundtable of Industrialists (ERT), is a worthwhile read for anyone concerned about corporate political power. The 30-page report, in a sense Richardson's memoirs, offers an insider's view on what has made the ERT such a central player in the process of European unification during the last decades. Richardson aims to explain, "what it is those mysterious businessmen actually think they are doing". Despite being published by a university institute, the report is far from an academic study, but rather Richardson's highly subjective defence of the ERT's record during his time as Secretary General, from 1988 to 1998.

Success Story?

Anyone who has read "Europe, Inc." or other studies on the ERT, will recognise the general portrait of how this group, comprising 45 CEOs of the largest Europe-based corporations, works. Also familiar is the overview of the string of successes it has booked in the EU policy arena. [1] In the report, Richardson confirms the picture of the ERT as an 'agenda-setting' organisation, with a focus and working style that made it far more effective than other, more traditional, business lobby groups in Brussels. Richardson makes no sweeping statements about the ERT's influence, but lets quotes by some of Europe's most powerful politicians speak for themselves. According to Jacques Santer, former European Commission President, the Roundtable "without any doubt played a major role in the development of the European Union". [2] "The ERT has something to say. European politicians recognise it. And listen", Santer said in early 1999, only a few months before resigning due to mismanagement and corruption among his Commission colleagues.

Richardson's review of ten years ERT history includes a wealth of interesting details about how the group worked to realise its political agenda. The team-work with the European Commission was key to the major early success in pushing through the plans for a border-free European single market, which Richardson describes as, "the issue that best defined the ERT's driving spirit and its members' yearning desire to shake off the barriers imposed by governments." ERT demands for massive expansion of motorway links and other transport infrastructure to facilitate the booming trade flows were rewarded with the EU's Trans-European Networks scheme (TENs). In Richardson's words, Missing Links, the most influential ERT report on transport infrastructure, has "left an indelible trace on the map of Europe". [3] The former ERT boss describes the group's role in building political support for the single currency and its strong involvement in the political process resulting in the 1997 Amsterdam Treaty. According to Richardson, the ERT's lobbying offensive in the run-up to the Amsterdam Summit was actively encouraged, not only by Commission President Santer but also German Chancellor Kohl, French President Chirac and Dutch Prime Minister Kok, who held the EU Presidency at the time. [4] Examples like these show how corporate political power is by no means one-way traffic: leading European politicians have actively solicited industry involvement and backing for their common agendas, such as fast-tracking European unification.

After contributing to accelerating the European unification process and steering it into a direction that boils down to a fundamental restructuring of societies along the interests of big business, the last few years have been a time of fine-tuning for the ERT. Richardson sees the EU's Jobs Summit in Lisbon in the spring of 2000 as the peak of ERT influence on the EU's political agenda. This summit explicitly stated that international competitiveness is the EU's prime policy target and benchmarking a prime policy tool. Benchmarking, as regular readers of this newsletter will know, is decision-making based on the international comparison of factors that influence corporate competitiveness, obviously a dream exercise for business, but hardly beneficial for the democratic process. Revealingly, Richardson admits that the ERT's promotion of the 'competitiveness' discourse was first of all "purely defensive, against the tide of what members saw as pernicious social legislation". The logic is simple: when international competitiveness becomes the overriding concern, many proposals for strengthening social justice tend to drop off the mainstream political agenda.

The ERT has contributed heavily to the "competitiveness" ideology penetrating thinking on almost every European policy issue. One lesser-known example is the reshaping of European education systems to make them fit corporate priorities. This has been a more significant theme for ERT lobbying than often thought. According to Richardson, the ERT report "Education for Europeans - Towards a Learning Society" was circulated to no less than 30.000 people, both political decision-makers and people in the education world. [5]

Among the ERT's successes, Richardson also counts the 1995 launch of the Transatlantic Business Dialogue (TABD), a corporate- state body involving US and EU-based corporations and government representatives. [6] ERT corporations have since then played a dominant role in the TABD, which has the mandate to identify government rules to be deregulated in order to ease Transatlantic trade flows.

Access opens doors

The secret behind the ERT's influence has always been its privileged access to top-level political decision-makers, both in the European Commission and national governments. Richardson's "memoirs" confirm the very close connections, including frequent meetings, between the ERT and European Commission Presidents Delors and Santer. [7] Richardson also gives a brief insight into what was discussed when ERT delegations met with Prime Ministers like Felipe Gonzalez, Ruud Lubbers, Wim Kok and Helmut Kohl. Kohl, for instance, "was noticeably more receptive to business talk about competitiveness at his second ERT meeting, because of his growing concern about unemployment and under- investment in German industry". Luxembourg's Jean-Claude Juncker who met an ERT delegation in 1997 was at first sceptical about the ERT's demands for far-reaching economic deregulation, but "went on to incorporate ERT ideas about job creation in the Luxembourg employment summit which he chaired two months later." [8] The doors to European heads of government seem to be always open for the ERT. In Richardson's time, the group met with five successive French Prime Ministers and two Presidents. The only country, whose government did not respond to the ERT's wish to meet with its Prime Minister was, perhaps surprisingly, the UK. [9] Apart from these direct meetings, Richardson stresses the importance of the ERT's regular letters to EU Summit meetings. "When EU leaders gathered every six months or so they became accustomed to receiving letters addressed to each of them personally, asking them to pursue some specific objective, whether job creation or trade agreements or whatever", Richardson writes. [10] The ERT's access, Richardson explains, is based on the fact that its handpicked members without exception are powerful industrialists with a strong political standing in their home country. Compared to the employer's federation UNICE, the ERT "only handles the very big issues", and the group is "only dealing at very high level, talking to senior people in the kind of language that senior people would find time for", writes Richardson.

Managing the ERT

Richardson emphasises that the ERT was relaunched in 1988, at a time when the future of the group was uncertain. The ambitious Philips-boss Wise Dekkers took over as ERT chair, moved the group's office from Paris to Brussels and hired Richardson to build an effective organisation. "The relaunch was total", says Richardson. His expose of how much effort had to be made to ensure active involvement by the CEOs in the ERT's work show that the group has in fact at times been far weaker and more vulnerable than often assumed by its critics. Richardson goes into considerable detail describing the management task of making active involvement in the ERT attractive to its members. "The ultimate test was that members must turn up at Plenary Sessions", the ERT's six-monthly decision-making body, Richardson writes. These events were carefully prepared, so the industrialists would get maximum benefits with a minimum investment of time. "Typically they would gather on a Sunday evening for dinner hosted by one of the members, held perhaps in some rather special place - a museum in Berlin, an opera house in Milan, or even in a royal palace in London - to hear remarks from a Prime Minister or other dignitary", Richardson explains. [11] He reveals that "great pains were taken to keep the dates and locations confidential to avoid unwelcome interruptions". And indeed, due to the secrecy, activists have till date not managed to stage protests against ERT events. According to Richardson, there are two prime reasons that the ERT is attractive to busy industrialists, compared to the multitude of other European corporate lobby groups. One is its character of a closed club for the elite of European business. The second is its privileged access, enabling the group to offer what Richardson describes as the most effective "way through the communications morass" of EU politics.

Richardson stresses the role of the ERT's many working groups. Here it is not the chairmen and CEOs, but the next level of managers from the member companies that do the bulk of the work. In the light of this structure, Richardson's insistence that ERT membership is "personal and not corporate" is highly inconsistent. This argument is often used as an excuse for companies not to have to explain their involvement in the ERT. [12] The argument is flawed, as becomes clear when Richardson points out that an ERT member is expected to "commit his company" and that ERT members "spoke for his company and did not have to look over his shoulders for instructions." [13]

The Unknown Roundtable

Richardson also touches on the question why, despite its significant influence over EU policies, the ERT is virtually unknown. According to Richardson, the group would have liked mass media coverage of their messages, but felt unable to get the attention of the press. Richardson's explanation of the ERT's low media profile is that the group is "too discrete to be newsworthy" and that there is a general lack of interest for EU issues in the still very much national-focused media. Richardson fails to mention that this has also helped to keep the ERT from receiving negative publicity. Moreover, the ERT's political influence is obviously not based on winning over public opinion. Indeed, the group has benefited enormously from the fact that EU politics largely takes place in virtual absence of public debate and with limited media coverage.

The ERT's Future Course

Richardson is worried about "the general antipathy against big business", exemplified by the Seattle anti-WTO demonstrations, and concludes that business is doing "a bad job of explaining its own activities". Faced with a growing number of critics, Richardson argues that big business must "organise itself as effectively as possible so as to communicate its ideas clearly and convincingly, over the long-term, and in a way that reaches beyond the world leaders and through to the ordinary voters". Critical about developments since he left the organisation, Richardson is not sure the ERT can deliver on this challenge in the future. [14] If the ERT "carries on without radical development, that would count as failure because it would not be making the contribution it is capable of making, it would not be rising to the challenge", Richardson writes. These and other similar remarks leave the impression that his relations with the current ERT management are less than amicable.

As a way forward for the ERT, Richardson mentions the idea that the group should give up its "club" structure and expand to a membership of two hundred corporations. Richardson advises the ERT to further intensify lobbying of European and national decision- makers, to expand ERT work to cover all "major business issues", to build stronger links with business groupings in other Northern countries, and to step up its involvement in the issue of "long-term governance of the global economy". Richardson also recommends that the ERT prioritises outreach to the media as well as establishing dialogue with NGOs and trade unions. These last points are characteristic of the work of two groups with whom Richardson has worked since leaving the ERT - European Policy Centre (EPC) and Friends of Europe. [15] Both of these promote a corporate-centred development model for Europe very similar to that of the ERT, but their image as independent think-tanks makes it easier for them to reach the media as well as build 'partnerships' with NGOs.

Enlightened Industrialists?

Richardson reserves several pages to deal with the ERT's critics. A first surprise in this section is how little he seems to know about the range of critical studies published on the ERT in recent years. Comprehensive publications like "Europe, Inc." and "The Green Capitalists", which challenge the ERT's politics and power, are not mentioned at all. [16] Instead Richardson calls the brochure 'Misshaping Europe' "the most coherent statement of these criticisms". This "carefully researched paper", written in 1993 by ASEED Europe activists who were later to establish CEO, is far less ambitious and comprehensive than for instance the two books mentioned above. It is therefore obviously also much easier for Richardson to respond to. Whether the ERT's intelligence gathering on its critics was really that bad or Richardson for the sake of convenience ignores more challenging critical writings remains unclear.

Richardson's response to the critique of the negative impacts of ERT influence on democracy as well as social and environmental progress is extremely simplistic. In his world-view, industrialists "are generally aware of the world's problems" and have "coherent policies for dealing with many of them". Business creates wealth, Richardson argues, which benefits all and it is then up to governments to distribute resources to those areas where it is needed. Richardson's writings lack even the slightest acknowledgement of the multitude of problems caused by corporations, let alone the effects of the global expansion and the rise in corporate power in the last decade. "Big business is a legitimate actor in society with a right to be heard like any other legitimate actor", Richardson continues. Proposals by business, he claims, are only part of the debate and after all it is governments and parliaments that decide. Compared to the previous 25 pages outlining example after example of excessive corporate influence on EU policies, based on privileged political access and massive resources, this rosy image is deeply hypocritical.

Elsewhere in his report, Richardson argues that the ERT "spoke up for the free market economy and for the interests of the biggest players within that market", but that "they did so in an enlightened way". As an example he claims that the ERT members "had no difficulty in meeting the environmental issue half way" and that "they accepted the reality of global warming". This corresponds very poorly with the reality of ERT efforts on the environment. In the early 1990's, the ERT ran a working group called the "Environmental Watchdog Group". The purpose of these watchdogs was by no means to promote environmental policy making, but rather to monitor new developments and obstruct potential challenges to corporate interests. On global warming, the reality is that it took until 1997 before the ERT, forced by the political reality of the climate debate in Europe, grudgingly acknowledged that climate change is a fact and that it is caused by human industrial activities. [17] Since then the ERT has adopted a more clever, but deeply cynical, strategy of attempting to postpone or prevent necessary political action by pushing for EU climate change policies to be based on business self-regulation and emissions trading. The ERT has always been careful in framing its messages strategically so as to maximise the chance of gaining influence, but the underlying agenda is not enlightened, but simply profit-driven. [18]



European Roundtable of Industrialists (ERT)]



Maastricht II and Corporate Lobby successes

The ERT Goes East

'Win-Win?' The ERT and EU Enlargement

Innovation: Corporate Restructuring of Europe

European Think-Tank Series - The European Policy Centre http://www.xs4all.nl/~ceo/observer2/epc.html

ERT and REC: Strange Bedfellows

ERT Moves to Next Stage of Europe's 'Double Revolution'

Intergovernmental Conference 2000: Business and the Amsterdam Leftovers

New EU Treaty May Give European Commission 'Fast-Track' Negotiating Authority


1: Balanya, B., et al. "Europe, Inc.: Regional and Global Restructuring and the Rise of Corporate Power". Pluto Press, January 2000. | Back to Text |

2: "Big Business and the European Agenda", SEI Working Paper No. 35, Sussex European Institute, University of Sussex, September 2000. Page 20. | Back to Text |

3: Ibid, page 21. | Back to Text |

4: ibid, page 4. | Back to Text |

5: ibid, page 16. | Back to Text |

6: Richardson was an advisor to both the Transatlantic Policy Network (TPN) and the Transatlantic Business Dialogue (TABD). | Back to Text |

7: Interestingly, the EC's replies to CEO's requests for access to documents on the relations between these EC Presidents and the ERT failed to provide those documents showing the intensity of the links that is revealed in Richardson's report. Why, for instance, did CEO not receive copies of correspondence concerning Santer's participation in the ERT 15th anniversary reception, January 1999, where he was keynote speaker? Was all of that arranged by phone? Rather, this is another example of the EC's consistent failure to provide full disclosure on its links with corporate lobby groups. | Back to Text |

8: ibid, page 15. | Back to Text |

9: "Only the British were strangely reluctant, and despite several requests by British members, and despite friendly letters echoing broad agreement on policy priorities, the doors of 10 Downing Street never opened to the ERT". "Big Business and the European Agenda". ibid, page 15. | Back to Text |

10: ibid, page 15. | Back to Text |

11: ibid, page 7. | Back to Text |

12: See Corporate Europe Observer, Issue 3, June 1999, "Ending Corporate Secrecy", http://www.xs4all.nl/~ceo/observer3/general.html#ending | Back to Text |

13: ibid, page 6. | Back to Text |

14: "When I left the ERT in 1998 I thought that the base was strong and that future prospects were bright. Today I am less sure". Richardson, page 28. | Back to Text |

15: For background on the European Policy Centre, see for instance Corporate Europe Observer, Issue 2 (October 1998), available online: http://www.xs4all.nl/~ceo/observer2/epc.html | Back to Text |

16: Nyberg, Mikael. "The Green Capitalists", published by Friends of the Earth Sweden, 1999. | Back to Text |

17: See for instance "Greenhouse Market Mania - UN climate talks corrupted by corporate pseudo-solutions", CEO briefing, November 2000. Available online: http://www.xs4all.nl/~ceo/greenhouse/index.html | Back to Text |

18: The ERT is clearly more strategic than other business lobbies in the way it presents its demands to decision-makers. "The fundamental requirement", Richardson states, "was that ERT messages must be acceptable, otherwise we were wasting our time". Richardson, page 14. | Back to Text |

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